Financial Data and Key Metrics Changes - Total revenue for Q2 2026 was $48.2 million, a record for the quarter, representing a 12.2% increase year-over-year [8][12] - Equipment revenue increased by 12% to $24.3 million, driven by strong demand and pricing strategies [10][14] - Recurring revenue grew by 12.5% to $23.8 million, maintaining a gross margin of 90.2% [9][13] - Operating income rose by 32% to $14.8 million, while net income increased by 29% to $13.5 million, representing 28% of revenue [10][22] - Adjusted EBITDA increased by 26% to $15.3 million, with an EBITDA margin of 32% [23] Business Line Data and Key Metrics Changes - Equipment revenue growth was supported by the locking segment and intrusion and alarm products, both showing double-digit increases [6][28] - Gross margin for equipment revenue improved to 28%, up from 24% a year ago, reflecting pricing discipline and operational efficiency [9][10] - Recurring service revenue now has a prospective annual run rate of approximately $99 million, up from $95 million last quarter [10][13] Market Data and Key Metrics Changes - The company reported strong demand across its product portfolio, particularly in school security solutions and door locking products [31][32] - The transition away from legacy copper phone lines is expected to drive additional market share for StarLink radios [33] Company Strategy and Development Direction - The company is focused on enhancing shareholder value through its recurring revenue model, which is expected to provide steady growth and profitability [6][27] - The appointment of a new Chief Revenue Officer aims to accelerate revenue growth and strengthen customer relationships [29][30] - The company is investing in innovation and infrastructure while maintaining a debt-free balance sheet, allowing for strategic opportunities and capital returns [29][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining momentum through fiscal 2026, with strong demand and operational discipline in place [7][31] - The company is optimistic about the growth of its recurring service revenue and the impact of new product offerings like the MVP cloud-based access control platform [32][33] - Management acknowledged the importance of school security and the integration of various technologies to drive future growth [31][32] Other Important Information - The company increased its quarterly dividend to $0.15 per share, reflecting confidence in its cash generation capabilities [11][29] - Cash and marketable securities totaled $115 million, providing substantial flexibility for investments and shareholder returns [11][25] Q&A Session Summary Question: What is the current inventory situation in the dealer channel? - The channel has normalized, with more stable buying patterns observed, contributing to improved gross margins [36][37] Question: What is the outlook for the MVP Access platform? - The MVP Access platform is expected to contribute meaningfully to recurring service revenues in the second half of calendar 2026 [39][40] Question: How is the hardware growth characterized, particularly in larger projects? - The company is seeing ongoing projects, particularly in schools, with no difficult comparisons expected for the remainder of the fiscal year [49][50] Question: What is the status of the ADI partnership? - The ADI relationship continues to be beneficial, with ongoing introductions to large dealers, although there is room for improvement in locking contributions [54][55] Question: Is there a need for additional pricing actions in the second half? - Current pricing adjustments are expected to be fully realized, with no immediate need for further increases [48][60] Question: What is the outlook for cash management and potential acquisitions? - The company is considering various options for capital allocation, including acquisitions and increasing dividends, while ensuring any acquisitions are accretive [70][72]

Financial Data and Key Metrics Changes - Total revenue for Q2 2026 was $48.2 million, a record for the quarter, representing a 12.2% increase year-over-year [9][13] - Equipment revenue increased by 12% to $24.3 million, driven by pricing strategies and strong demand [10][15] - Recurring revenue grew by 12.5% to $23.8 million, maintaining a gross margin of 90.2% [10][14] - Operating income rose by 32% to $14.8 million, while net income increased by 29% to $13.5 million, representing 28% of revenue [11][24] - Adjusted EBITDA increased by 26% to $15.3 million, resulting in an EBITDA margin of 32% [25] - Cash and marketable securities totaled $115 million, reflecting a 16.3% increase from the previous period [26][27] Business Line Data and Key Metrics Changes - Equipment revenue growth was supported by strong performance in door locking solutions and intrusion and alarm segments [30] - Gross margin for equipment revenue improved to 28%, up from 24% in the prior year [10][18] - Recurring service revenue now represents nearly half of total sales, with an annualized run rate of approximately $99 million [29] Market Data and Key Metrics Changes - The company continues to see strong demand across its product portfolio, particularly in school security solutions [34] - The transition away from legacy copper phone lines is expected to drive significant growth in radio sales, with a projected increase in market share [36][71] Company Strategy and Development Direction - The company is focused on enhancing shareholder value through its recurring revenue model, which provides predictable cash flow and long-term growth [8][29] - The appointment of a new Chief Revenue Officer aims to accelerate revenue growth and strengthen customer relationships [32] - The company is investing in innovation and infrastructure while maintaining a debt-free balance sheet [33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining momentum through fiscal 2026, with strong operational discipline and a focus on expanding recurring revenue [8][34] - The company is optimistic about the demand for its products and the potential for new market opportunities, particularly in school security [34][35] Other Important Information - The board approved a quarterly dividend increase to $0.15 per share, reflecting confidence in the business [12][32] - The company is actively managing inventory and investing in product development to support growth [33] Q&A Session Summary Question: What is the current inventory situation in the dealer channel? - The channel has normalized, with more stable buying patterns observed, contributing to improved gross margins [39][40] Question: Can you provide an update on the MVP access platform? - The MVP platform is expected to contribute meaningfully to recurring service revenues in the second half of calendar 2026 [42][44] Question: Has storm activity impacted supply chain operations? - There has been no significant impact on supply chain operations, with only minor delays noted [45][47] Question: What is the outlook for pricing actions in Q3? - Pricing adjustments have been fully implemented, with no additional increases expected for the remainder of the year [51][52] Question: How is the ADI partnership progressing? - The ADI partnership continues to yield introductions to large dealers, with ongoing efforts to enhance contributions from the locking segment [57][58] Question: What are the plans for capital allocation given the increasing cash reserves? - The company is considering various options for capital allocation, including potential acquisitions and increasing dividends [73][75]

Financial Data and Key Metrics Changes - Total revenue for Q1 2026 was $49.2 million, a record for the quarter, representing a 12% increase year-over-year [9][12] - Net income rose 9% to $12.2 million, which is 25% of revenue, and adjusted EBITDA increased 21% to $14.9 million, equating to an adjusted EBITDA margin of 30.4% [10][16] - Cash reached $106 million as of September 30, 2025, with cash from operations at $11.6 million [10][17] Business Line Data and Key Metrics Changes - Equipment sales were $25.7 million, up 12% year-over-year, supported by price adjustments and strong distributor relationships [9][12] - Recurring revenue grew 11% to $23.5 million, maintaining a gross margin of 90.3%, driven by Starlink Fire Radios [10][12] - Equipment gross margin improved to 26%, a 300 basis point increase from the previous quarter [10][14] Market Data and Key Metrics Changes - The company reported strong sell-through stats for locking products, with locking sales at $17.1 million for Q1, a significant increase from $13.9 million in the same period last year [36][37] - The recurring revenue service now has a prospective annual run rate of approximately $95 million, reflecting continued demand for StarLink Fire Radios [12][13] Company Strategy and Development Direction - The company is focused on enhancing shareholder value through a recurring revenue model, which now represents nearly half of total sales [19][20] - NAPCO is investing in school security solutions, integrating locking, access control, and alarm technologies to provide comprehensive safety solutions [20][21] - The introduction of the MVP Cloud-Based Access Control platform aims to create a new subscription-based revenue stream, enhancing the company's market position [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to weather economic challenges and continue executing its growth plan [6][7] - The company anticipates further benefits from pricing strategies and expects to see a larger impact in upcoming quarters [9][10] - Management highlighted the importance of innovation and operational efficiency in maintaining competitive advantages [19][20] Other Important Information - The company declared a quarterly dividend of $0.14 per share, payable on January 2, 2026 [10][11] - NAPCO's manufacturing facility in the Dominican Republic is noted for its cost efficiency and stability, providing a competitive edge [23][57] Q&A Session Summary Question: What percentage of your locking mix is represented by networked products? - Most sales in locking are traditional products, with MVP just starting to gain traction [26][27] Question: How does MVP technology differ from competitors? - MVP is a fully integrated system that combines locks and cloud services, allowing for enhanced functionality and recurring revenue [29][30] Question: How much of the hardware revenue growth was due to price versus volume? - Approximately 60% of the 12% increase in equipment revenue was due to volume increases, with 40% tied to pricing increases [34] Question: What is the status of the Pasadena school contract? - The project was completed successfully, and there are significant opportunities in school security across the country [82][84] Question: What are the plans for the cash on the balance sheet? - The company is considering potential M&A opportunities but remains cautious to ensure any acquisition is accretive [87][89]

As filed with the U.S. Securities and Exchange Commission on June 28, 2024. Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 SAFE PRO GROUP INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) Delaware 8713 87-4227079 (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 18305 Biscayne Bl ...